Acquirers Are Snapping Up Boom-Era Startups That Haven’t Raised Funding In Years
Despite years without new funding, venture-backed startups from the 2021 boom are increasingly being acquired. Recent major deals, including Uber buying ezCater for $2.3 billion, show acquirers stepping in despite valuations often falling far below former peaks.
Typically, when a venture-backed startup goes several years without securing a new funding round, conventional wisdom suggests its chances for a lucrative exit have diminished.
However, an examination of Crunchbase data reveals that this is frequently untrue. Several major acquisitions of private companies this year feature startups that have not publicly disclosed a fresh investment in more than four years.
A number of these deals are quite recent and substantial. Most notably, Uber purchased ezCater—a workplace meal and catering platform—for $2.3 billion in cash earlier this month. This transaction occurred nearly five years after the Boston-based company raised its final reported venture capital round.
This is not an isolated incident. Several companies recognizable from the 2021 pandemic-era boom have been acquired recently, including former highfliers such as Miro, Airtable, and Headspace. Frequently, these businesses are changing hands at valuations that, while substantial, remain far below their previous peaks.
Who’s getting acquired
To demonstrate the frequency with which these mature startups are finding buyers, we analyzed Crunchbase data to compile a list of 15 transactions involving well-capitalized companies that have not raised equity financing in four years or more.
Post-peak runway
A primary challenge for mid-to-late-stage startups is that valuations reached a cyclical high point during 2021 and early 2022. Many businesses that secured capital during that period struggled to attract new money or were hesitant to accept down rounds at slashed valuations. Even with the recent artificial intelligence boom, very little capital flowed to this particular group.
Furthermore, because the funding rounds from the 2021 boom were exceptionally large, these startups routinely had the cushion needed to trim operating expenses and stretch their cash reserves using existing funds. Consequently, many companies that have avoided raising new rounds for years continue to operate, surviving and even expanding independently of fresh venture injections.
EzCater serves as a prime example. In the year leading up to its buyout, the enterprise produced upwards of $2.5 billion in gross bookings, maintaining an annual growth rate in the high teens alongside average order sizes exceeding $400.
Even so, that performance and revenue trajectory did not guarantee ezCater a massive acquisition premium over its previous funding round. At $2.3 billion, Uber’s purchase price represents a 53% increase over the $1.5 billion pre-money valuation the catering company achieved during its final funding event in late 2021.
Acquisitions below peak venture valuation
In many instances, even sizable buyouts of well-funded startups are taking place at valuations drastically lower than their former highs.
Consider Miro, a digital collaboration tools developer that agreed to an acquisition by Bending Spoons last month for roughly $1.36 billion. That represents a steep decline from early 2022, when the San Francisco-headquartered business finalized its previous round at a post-money valuation of $17.5 billion.
Similarly, Bending Spoons previously acquired data and workflow platform Airtable for $1.28 billion in August. That figure is barely over one-tenth of the $11 billion valuation Airtable commanded during its December 2021 Series F.
Apparel startup Everlane is another firm that lost its luster following a valuation in the hundreds of millions back in 2020. It was acquired by fast-fashion giant Shein this spring for $100 million.
Within the health and wellness sector, Headspace experienced a severe valuation drop as well. The mental health and meditation application was bought by Sword Health in an agreement reported at approximately $300 million, falling well short of its peak post-money valuation near $2.6 billion.
A good thing?
Although startup investors are hardly celebrating buyouts that occur far below peak private valuations, such outcomes are far from the worst-case scenario. For the startups themselves, they are also far from catastrophic.
Undoubtedly, every unicorn investor dreams of generating high-multiple returns. Yet, for startups spending years without securing fresh funding, current market conditions indicate those returns are unlikely to happen.
Related Crunchbase list:
- Acquired Startups That Hadn’t Raised Venture Funding For 4+ Years
- Global M&A In 2026 For Venture-Backed Companies
Related reading:
- Global Venture Funding And Unicorn Creation In 2021 Shattered All Records
Illustration: Dom Guzman
Frequently Asked Questions
01Why are startups that haven’t raised funding in years getting acquired?
Many mature startups raised large amounts of capital during the 2021 boom, allowing them to cut costs and extend their runways. When they are ready to exit, acquirers are stepping in—often at valuations below their 2021 peaks—because these companies still possess strong underlying business metrics and gross bookings.
02What was Uber’s acquisition of ezCater?
Uber purchased ezCater, a workplace meal and catering platform, for $2.3 billion in cash. This came nearly five years after ezCater’s last reported venture funding round in late 2021.
03Are these acquisitions happening at higher valuations than the 2021 peak?
No. In many cases, well-funded startups are being acquired at valuations significantly lower than their former peaks. For example, Miro agreed to sell for about $1.36 billion, down from its early 2022 valuation of $17.5 billion.
